29th Apr 2025 17:00
(Alliance News) - The FTSE 100 extended its winning run to twelve on Tuesday despite mixed earnings and more weak US economic data.
The FTSE 100 index rose 46.12 points, 0.6%, at 8,463.46. The FTSE 250 advanced 76.41 points, 0.4%, at 19,809.72, and the AIM All-Share gained 5.56 points, 0.8%, at 681.31.
The Cboe UK 100 rose 0.6% to 843.73, the Cboe UK 250 climbed 0.4% at 17,331.20, while the Cboe Small Companies gained 0.4% at 15,315.46.
Supporting the FTSE 100, a 3.0% gain in HSBC, the second largest company by weighting in the index. The largest, AstraZeneca, pared earlier heavy losses to close up 0.2% after its first quarter results.
In Paris on Monday, the CAC 40 ended 0.2% lower, while Frankfurt's DAX 40 climbed 0.7%.
Deutsche Bank said it has turned "back bullish" on European equities.
"The tonality on tariffs softened, sentiment indicators surprised positively, hopes for a ceasefire have re-emerged, earnings revisions were sharply down and now leave room for positive surprises and there is 'no intention to fire' Fed Chair Powell any longer. Furthermore, European and especially German politics continue to be more market-friendly," the broker commented.
On Wall Street, at the time of the London close, the Dow Jones Industrial Average traded 0.5% higher, the S&P 500 rose 0.1%, while the Nasdaq Composite eased 0.1%.
Alongside a slew of earnings, investors weighed data which showed US consumer confidence has fallen to its lowest level since the onset of the Covid-19 pandemic, reflecting concerns about President Donald Trump's tariff plans.
The Conference Board's US consumer confidence index fell 7.9 points to 86.0 in April.
Worse, the Expectations Index - based on consumers' short-term outlook for income, business, and labour market conditions - dropped 12.5 points to 54.4, the lowest level since October 2011 and well below the threshold of 80 that usually signals a recession ahead.
Stephanie Guichard, senior economist at the Conference Board said: "Notably, the share of consumers expecting fewer jobs in the next six months (32.1%) was nearly as high as in April 2009, in the middle of the 'Great Recession'."
Elsewhere, a report showed the number of job vacancies in the US dropped more than expected in March.
Available positions decreased to 7.19 million in March from a revised 7.48 million reading in February, according to monthly Bureau of Labor Statistics.
FXStreet consensus had predicted a figure of 7.5 million.
A separate report showed the US trade deficit widened as imports surged ahead of the imposition of tariffs.
Analysts at Oxford Economics said: "Front-loading of imports remained in full effect, with imports shattering previous record totals. This sets the stage for a potential 9 [percentage points] drag on Q1 GDP due out tomorrow."
On Wednesday, a first estimate of first quarter US GDP will be released.
The dollar weakened on the back of the soft data on expectations the Federal Reserve will cut interest rates to shore up the US economy.
Against the yen, the dollar was trading lower at JPY142.18 on Tuesday at the London equities close compared to JPY142.73 on Monday. The pound traded higher at USD1.3407 compared to USD1.3389 on Monday.
The euro stood higher at USD1.1400 on Tuesday against USD1.1384 on Monday.
In London, investors weighed a slew of earnings with gains for HSBC, but falls for BP and Associated British Foods.
HSBC rose 3.0% after first quarter profit beat expectations and it announced a new USD3.00 billion share buyback programme.
Bank of America said: "HSBC printed a strong set of [first quarter] numbers, with underlying pretax profit beating consensus by 15%. While outlook is clearly more challenging given falling rate expectations, as well as tariff-related uncertainty, management's guidance in this regard feels reasonable. This should anchor sentiment given HSBC's exposure to global trade."
Looking ahead, HSBC said it expects muted demand for lending in 2025 due to economic uncertainty driven by US protectionism.
"However, over the medium to long term we continue to expect mid-single digit percentage growth for year-on-year customer lending balances. We continue to expect double-digit percentage average annual growth in fee and other income in Wealth over the medium term," HSBC commented.
BP fell 2.6% after reporting underlying replacement cost profit nearly halved to USD1.38 billion in the first quarter of 2025, falling from USD2.72 billion a year prior, and missing the USD1.53 billion company-compiled consensus.
Citi said this was 10% below market expectations, hurt by higher financing costs and tax.
Operating cash flow nearly halved to USD2.83 billion from USD5.01 billion a year prior.
Net debt increased by 12% to USD26.97 billion from USD24.02 billion, primarily driven by lower operating cash flow. In the last quarter alone, net debt rose from USD23.00 billion.
In addition, BP announced a GBP750 million share buyback, at the low-end of the previously guided range of GBP750 million to USD1 billion and a marked reduction from prior quarters.
Associated British Foods fell 9.2% after it slashed profit guidance for its Sugar business, saying the recovery will take longer-than-expected.
Chief Executive George Weston said: "I am frustrated with the results in our Sugar business, but we are clear on what needs to be done by way of operational and regulatory solutions to improve financial performance."
AB Foods now expects Sugar to have an adjusted operating loss of up to GBP40 million in the financial year compared to previous guidance for a profit of GBP50 million to GBP75 million.
Sales at its retail business Primark slipped by 1% to GBP4.47 billion from GBP4.50 billion a year ago but rose 1% at constant currency.
Elsewhere, well received trading updates lifted kitchen maker Howden Joinery and bookmaker Entain, up 4.6% and 3.3% respectively.
But Ashtead fell 2.4% after RBC Capital Markets downgraded to 'sector perform' from 'outperform'.
"We struggle to escape the conclusion that seismic changes in US economic policy are likely to lead to lower equipment rental demand over the next 12 to 18 months," the broker commented.
"We thought the election of President Trump would usher in a sustained period of corporate confidence in the US, accelerating the end of the equipment rental industry's mid-cycle slowdown in response to tightening monetary policy. How wrong we were," the broker added.
Brent oil was quoted lower late on Tuesday in London at USD64.48 a barrel, against USD65.52 late on Monday.
Gold traded lower at USD3,312.17 an ounce on Tuesday against USD3,326.61 on Monday.
The global economic diary on Wednesday sees US GDP data, quarterly personal consumption expenditures numbers, ADP unemployment figures and the Chicago PMI.
The domestic corporate calendar on Wednesday sees first quarter results from lender Barclays and trading statements from retailer Next and miner Glencore.
By Jeremy Cutler, Alliance News reporter
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